Setting a New Course

 Margaret Thatcher  overturns the bi-partisan mixed economy when she applies a non-interventionist free market policy. Some industries collapse, causing severe unemployment. She earns voters' support during the Falklands war and credit for her part in the fall of the Berlin Wall and the collapse of the soviet bloc, but she is overthrown in a party putsch. The period ends with sterling's failure to remain on course to join a single European currency and the Conservative party suffers an historic collapse in electoral support.

Margaret Thatcher had not even been elected prime minister when she suffered a severe loss at the hands of Irish republicans. Her close confidant Airey Neave, the Conservative spokesman on N. Ireland, who was the first British officer to escape successfully from Colditz, was killed when his car was blown up by an INLA bomb at the MPs’ car park. In August, the IRA scored further massive publicity when they blew up Lord Mountbatten and members of his family whilst on holiday in Co. Sligo in the republic. On the same day, they ambushed and killed 18 British soldiers at Warrenpoint in South Armagh. These events ensured that Northern Ireland remained near the top of Thatcher’s consciousness as she took over government.

After many years of poor performance, the British economy remained uncompetitive with rivals in Europe and Asia. Inflation was about 10% and some 1.5 million people were unemployed, compared to some 1 million in 1974. Thatcher’s government aimed to control inflation and deregulate the economy with a monetarist economic policy and wide-ranging political reforms.

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Their task was made more difficult when an oil crisis set off a world-wide recession in 1980 and once again threatened to wreck the economic agenda of an incoming British government. It began with the overthrow of the Shah of Iran in 1979 and the installation of an Islamic republic led by the Shia Ayatollah Khomeini. The US embassy was invaded and American diplomats were taken hostage. In September 1980, Saddam Hussein of Iraq invaded Iran, partly out of fear of the Ayatollah’s influence on the majority Shia population within Iraq. Oil production in the two countries fell and the price of oil more than doubled to nearly $40 dollars a barrel.

Although somewhat protected from the worst of the oil crisis by North Sea oil production, the British economy suffered in the resulting world-wide recession. Nevertheless, Sir Geoffrey Howe, the new Conservative Chancellor of the Exchequer, went ahead with the abolition of exchange controls and price controls and introduced the creation of tax-free enterprise zones and a move from direct to indirect taxation. His financial policy tightened money supply and restricted public sector pay. His deflationary second budget was strongly opposed by some Tory MPs, whom Thatcher described as ‘wets’, and 364 academic and professional economists wrote a letter to The Times excoriating its monetarist basis.

The anti-inflationary measures raised the exchange rate and the cost of borrowing, making imports cheaper and investment more expensive. Large numbers of factories, shipyards and coal pits became uneconomic and were closed down. However, inflation fell below 10% by the turn of 1982, having peaked at 22% in 1980, and by spring 1983, it had fallen to a 15-year low of 4%. Unemployment reached 3 million, or 12.5% of the workforce, by January 1982, a level that had not been seen for some 50 years. It remained stubbornly high throughout the 1980s, especially in the old industrial regions of the North, Scotland, N. Ireland and Wales. In 1981, riots, caused by racial unrest and deprivation, occurred in parts of London and other cities including Toxteth in Liverpool.

New trade union legislation was passed which was intended to reduce strikes in the public-sector workforce. The 1980 Employment Act outlawed secondary picketing and strictly controlled the formation of closed shop situations. It was followed by the more draconian act of 1982 introduced by the new Employment Secretary Norman Tebbit. The Trades Union Congress (TUC) reacted with a campaign to ‘kill the bill’, but the bill was quite popular in other public quarters and became part of the developing ‘Thatcherite’ revolution. Strikes fell to their lowest level since the early 1950s, and wages grew by 3.8% by 1983.

Nevertheless, the Thatcher government was extremely unpopular due the collapse of many industries and resulting large scale redundancies. However, its unpopularity was offset to some extent by troubles within the Labour Party. Callaghan had been replaced as leader by Michael Foot, a passionate orator who enthused the more socialist and anti-nuclear, anti-EEC wing of his party, but worried the pragmatists who wanted to remain in the mainstream of British politics. In March 1981, leading moderates, known as the ‘gang of four’, formed the Social Democratic Party, which soon entered an electoral and political alliance with the Liberals. They were joined by several sitting Labour members and a single Conservative rebel, who crossed the floor after the 1981 budget.

The world first began to notice Thatcher when the Lancaster House Agreement in December 1979 solved the intractable problem of Southern Rhodesia. The troublesome white leadership finally gave way and accepted a route map which took the country to independence under majority rule as Zimbabwe in 1980. Few at the time anticipated Robert Mugabe would win power and sweep away all democratic opposition and the white minority economy in the ensuing decades. Apart from Hong Kong, no place of any importance remained of the once mighty British Empire and Thatcher could never have anticipated that a remote archipelago of islands in the South Atlantic would confront her with an imperial crisis.

She was, therefore, shocked when Argentines raised their flag on South Georgia and then invaded the Falkland Islands (alias Malvinas) 2nd April 1982. She was further taken aback when her trustworthy Foreign Secretary Lord Carrington considered he was honour-bound to resign because of the Foreign Office’s failure to ensure Argentina was aware Britain would not relinquish control of the Falklands. A task force was quickly formed to sail south and retake the islands. The campaign was overseen by a war cabinet headed by Thatcher, which was legitimised by Security Council resolution 502 calling for a withdrawal of Argentine forces from the islands. Hostilities opened with the retaking of South Georgia, followed by the sinking of the Argentine cruiser Belgrano with the loss of 323 men by a British submarine. This caused the Argentine navy to recall all surface ships to their bases. However the Argentine air force armed with Exocet missiles remained a serious threat and sank HMS Sheffield and other ships. The loss of a transport carrying the task force Chinook helicopters was a particularly severe blow. British troops went ashore at San Carlos Water during the night of 21st May. The most serious British losses were incurred at Port Pleasant or Bluff Cove, when a confusion of orders led to the bombing of two troop-carrier ships loaded with men who should have disembarked some time before the attack. Stanley, the Falklands capital, finally fell on June 14th.

The nation was relieved and heartened by the Falklands success and, around the world, Britain and Thatcher were viewed with a new respect. Her exhibition of steely resolve and a return to economic growth earned the Conservatives an overwhelming election victory in the June 1983 general election, despite the continuing high unemployment figures. Labour, led by Michael Foot with a hard left manifesto, had its worst results since 1918 with 27.6% of the popular vote. The SDP-Liberal alliance was breathing down its neck with 25.4%, although it only won 23 seats to Labour’s 209.

Thatcher had also been preparing for an expected showdown with the miners' union, which had done so much to bring down the Heath government. Coal was stockpiled, road hauliers were recruited if needed to replace rail services and mobile police units were set up to deal with illegal flying pickets. In March 1984 the National Coal Board announced plans to close 20 unprofitable pits. The plans were opposed by the union, but its delegates decided not to hold another national strike ballot. The union leader Arthur Scargill led his Yorkshire miners out on strike, expecting other regions to fall in line. However, most of the Nottinghamshire miners continued to work in face of hostile picketing from their Yorkshire neighbours. Violence broke out and massed ranks of police were assembled to allow access to working pits and power stations. Orgreave coking plant was the site of the worst confrontation in June, but coal supplies remained accessible and by September, miners began to drift back to work. The strike was finally called off on 3rd March 1985.

At 2.54 am on 12th October 1984, in the Grand Hotel at Brighton, Mrs Thatcher was putting the finishing touches to a speech she was to deliver to the party conference later that day when the hotel was wrecked by an explosion caused by a bomb planted by the Provisional IRA. She and her husband Denis were taken unharmed from the wreckage, leaving five of her party members dead and 31 others injured, including Norman Tebbit, trapped alongside his wife, who sustained crippling injury for life. At 2.30 pm Thatcher delivered her speech to the delegates. Her sang froid not only rallied her supporters, but won further widespread admiration, although some who disliked her politics and her confrontational disposition expressed regret for her escape. The following year her university decided by an overwhelming vote that she was unworthy of an honorary doctorate.

Unemployment continued to rise and surpassed 3 million in 1986, whilst the Conservatives continued their schemes for the sale of council houses to tenants and a programme of privatizing state-owned industries and public services, including aerospace, telecoms, gas and electricity, water, the state airline, and British Steel. The Thatcher government was becoming recognised as the most radical since Attlee’s and also the most divisive in living memory.

Thatcher had also been involved in a conflict with European partners about the difference in the amount of money the UK paid into EEC coffers and the value of community support received by Britain. Eventually in 1984 the other members conceded the repayment of an annual rebate amounting to 66%. Relationships continued to be uneasy, but the Channel Tunnel project was given the go ahead in 1986; whereas the French state financed its share of the cost, Britain’s share was financed privately.

By that time, Thatcher had built a close personal relationship with Ronald Reagan, the President of the United States. They were both viscerally opposed to the continuing domination of Eastern Europe by the elderly, hard-line leadership of the Soviet Union. In 1981 approval was given for the deployment of US cruise missiles at Greenham Common, as a response to the opposing Soviet SS20 system. Greenham became famous for the women’s ‘peace camp’ which was set up to oppose US nuclear weapons on British soil. Missiles remained at Greenham until the Intermediate-Range Nuclear Forces Treaty was ratified in June 1988, which eliminated the super powers’ arsenal of mid-range nuclear missiles.

Thatcher’s attention had become fixed on an impending change in East-West relations. The aged Konstatin Chernenko, the third Soviet leader since November 1982, was clearly sick and incapable and Mikhail Gorbachev, one of the younger politburo leaders, was invited to visit the UK in December 1984. Thatcher got on well with him and informed Reagan about her hopes for the new man. Gorbachev was elected unanimously to be the next General Secretary of the Communist Party of the Soviet Union in March 1985. The Chernobyl disaster 1986 and an ugly, debilitating war in Afghanistan made him increasingly critical of the system he inherited. Although he remained an unshakeable communist, he began to pursue policies of perestroika, an attempt to restructure the hidebound Soviet society, and economy, and glasnost, increased openness and transparency in government institutions and activities.

Thatcher, Reagan and Gorbachev gradually built up a relationship which led to the two super-powers reaching agreement on the abolition of medium range missiles in 1988. Thatcher’s visit to Moscow in March 1987 astounded Russia, where she had once been christened ‘the Iron Lady’. Her stylish clothes and the uninhibited way in which she argued her case on TV and met people face to face in the street was a revelation to the people of the Soviet Union and its East European cohorts.

Her international prestige helped Thatcher to win the June 1987 election with a majority of 102, the first prime minister to serve continuously and win three successive elections since Lord Liverpool in 1820. The Labour party under Neil Kinnock had concentrated on the struggle with the Liberal Democrat Alliance for the central ground and, using modern communication methods, it made some modest gains. Unemployment had at last fallen below the 3 million mark for the first time since 1981, and inflation was standing at 4%, its lowest level for some twenty years. Britain was enjoying a boom, stoked by Chancellor of the Exchequer Nigel Lawson’s tax-cutting budget of 1987.

House prices in Britain doubled between 1986 and 1989. Employment was also booming, especially in the financial and retail sectors. The Big Bang deregulation of trading practices in October 1986 transformed the City of London and set it on route to becoming, once again, the world’s centre for financial services. New offices were springing up in the City and also at the enterprise zone of Canary Wharf. New commercial and housing developments were being built on old industrial sites all over the country. By the end of 1989, unemployment was down to 1,600,000. However, inflation was beginning to rise again and interest rates doubled during 1988. Thatcher and Alan Walters, her economics advisor, were in disagreement with Lawson about the economy and he resigned in October 1989, to be succeeded by relative newcomer John Major. Economists were warning of an imminent recession and it finally became reality in October 1990. Unemployment started to rise again and inflation touched 10% for the first time in eight years.

From 1987 onwards Thatcher’s star began to wane. She was increasingly out of step with her fellow members of the EEC as they planned to establish a single currency and deeper political union. Her strong opposition to those moves, expressed in her ‘Bruges speech’ of 1988, divided her traditionally pro-European party. As early as January 1986, her Defence Secretary Michael Heseltine resigned when she supported an American purchase of the Westland helicopter company against his preferred choice of a European conglomerate. By June 1989 she was in conflict with Lawson and Foreign Secretary Geoffrey Howe concerning steps to join the European Exchange Rate Mechanism. Howe was demoted to Leader of the Commons, although he remained nominal Deputy Prime minister.

Thatcher was opposed to the apartheid society in South Africa and consistently called for the release from gaol of Nelson Mandela, although she branded his African National Congress a terrorist organisation. However, she continued to oppose sanctions being applied to South Africa, regarding them as an offence against free trade and a deterrent to wealth creation, which she regarded as an essential foundation for the future of a mixed society in South Africa. On this matter she remained opposed to the wishes of Mandela, as well as all other Commonwealth members and many other countries.

However, she continued to win respect for her determined efforts to support freedom in Eastern Europe, where the Soviet empire had begun to crack apart. The formation of the trade union Solidarność, or Solidarity, at the Gdansk shipyard in 1980 flew the flag of Polish national belief as well as workers’ solidarity. In 1989 Solidarity won a resounding victory in the first free elections held in the eastern bloc. The Soviet leadership did not intervene as Solidarity took over the government in August. People in other Eastern bloc countries were also expressing discontent with the Soviet system. In September, the Austro-Hungarian border was permanently opened and thousands of refugees from the German Democratic Republic began to use it as a route into the West. The border guards did not intervene and, once more, Gorbachev did nothing to quell the public demonstration in support of liberty. Quite abruptly, the Soviet yoke was thrown off and communist rule in all the Eastern bloc countries began to collapse. One by one, they opened themselves up to democratic reform. In November the Berlin Wall itself was breached. The last of the Soviet-style dictators, Nicolae Ceaușescu of Rumania and his wife were executed on Christmas Day. With no warning build-up, the seismic events, for which Thatcher and Reagan had hoped, erupted in a matter of weeks.

Following the fall of the Berlin wall, the East German state was dissolved in October 1990 and Germany was reunified as a democracy ruled by the law of West Germany. Thatcher had a poor relationship with Chancellor Kohl, whom she feared would lead a united Germany to neutrality and hence a breakup of the NATO alliance, but she was eventually brought down by more localised events.

The Conservatives had long been opposed to high-spending councils, who were basically funded by a local property tax called the Rates which dated back to medieval times. Thus, services which benefited all the people were largely only paid for by local property owners, who were often in a minority among the local electorates. The Rate Act of 1984 attempted to put a cap on the rates of high-spending councils, but the government later decided the rates on domestic properties were to be replaced by the Community Charge, widely known as the Poll Tax. This was a fixed tax to be paid equally by all adult residents, with a reduction for some poorer people. Non-domestic properties were to be taxed nationally by the Uniform Business Rate. The changes were first introduced into Scotland in 1989 and aroused immediate uproar, proving very difficult to implement in some places. Protests against the tax escalated into riots, the worst being around Trafalgar Square in late March 1990, a week before the implementation of the tax in England and Wales. Large numbers of people refused to pay and local government and the justice system was overwhelmed by the rising number of enforcement actions.

The unpopular Poll Tax cost the Conservative party much support among the electorate. In the party itself, Thatcher’s increasingly disdainful behaviour towards some colleagues and her stance on European integration brought about the resignation of Sir Geoffrey Howe. His devastating resignation speech did much to further undermine her standing in the parliamentary party. Added to the electoral liability of the Poll Tax and damaging high interest rates, it encouraged a move to replace her. She was challenged by Michael Heseltine and, although she won the ballot, she narrowly missed the threshold necessary to avoid a second vote. She heard the news as she was visiting Paris to discuss the new Europe which had emerged from the peaceful defeat of the soviet system. On her return to London she announced her resignation on 22nd November 1990, after more than a decade in office.

Margaret Thatcher was the longest serving prime minister of the twentieth century and was probably also the century’s most divisive British political figure. Her uncompromising style and character became summarised by the term ‘Thatcherism’. Only Oliver Cromwell rivals her in the historical record as a polarising figure who stirs up extreme opinions of admiration or hatred. On the occasion of her semi-state funeral in September 2013, some people were moved to celebrate her departure with street parties and bonfires, whilst others lined the streets to pay respects to a remarkable woman who had a dramatic and lasting influence on events in Britain and the world beyond.

With Thatcher’s support, John Major was the quiet man chosen to succeed her as leader of the party and prime minister. Major was born into a middle class London family which suffered difficult times in the fifties due to his father’s poor health and difficulties in the family garden ornaments business. Earlier in his life his father had also worked as a circus performer and music hall manager. John Major became employed by Standard Chartered bank in the City and entered Parliament as MP for the rural constituency of Huntingdon in 1979. He became a cabinet minister after the 1987 election and was regarded as a successful Secretary to the Treasury, where he served alongside Nigel Lawson. To his own surprise, he was promoted to Foreign Secretary in July 1989, in succession to Sir Geoffrey Howe. Following Lawson’s resignation, Major became Chancellor of the Exchequer in October. He proposed a compromise solution to the contest between Thatcher and other European leaders over a common European currency, but his own conviction was that the pound should become part of the ERM. Eventually, Thatcher agreed: the pound entered the ERM with a value of 2.95 Deutch Marks and interest rates were cut by 1% to 14%. Following Thatcher’s downfall, Major allowed his name to go forward in the second leadership ballot. He was two short of an overall majority, but his opponents, Heseltine and Douglas Hurd the Foreign Secretary, both withdrew, leaving him the final winner at the end of November 1990.

He inherited a split party. Die-hard Thatcherites would never forgive the Conservative figures they blamed for her downfall, whilst the ‘wets’ felt renewed and free to pursue closer integration in Europe and a ‘more inclusive’ social policy at home. Heseltine was put in charge of solving the Poll Tax problem and came up with the replacement Council Tax, which is similar to the old rating system in that tax is paid by occupiers according to the assessed value of the property.

However, when he took over the premiership, Major’s first concern was the occupation of Kuwait by Saddam Hussein’s Iraqi armed forces. The UN Security Council condemned the invasion and set a deadline of January 1991.for withdrawal of Iraqi troops. A considerable British force was mobilised to join a US-led coalition army poised in Saudi Arabia to chase the Iraqis out of Kuwait if Saddam failed to comply. Operation Desert Storm was launched on 17th January, 1991, Kuwait was liberated in a matter of days and a cease fire was agreed at the end of February, after which allied forces pulled back when they were about 150 miles from Baghdad.

Saddam remained in power, but was faced with rebellions in the Shia dominated south and by Kurds in the north. The rebellions were put down with the usual brutal efficiency by Saddam’s Baathist party and the Iraqi Republican Guard. As great numbers of Kurds and others fled into Turkey and Iran they were gunned down by Saddam’s air and ground forces. John Major obtained NATO support for Operation Haven, a British-led humanitarian aid effort secured by a no-fly zone over northern Iraq. Royal Marines and the RAF were the principal forces involved.

Whilst the UK was involved in Desert Storm, John Major and members of his war cabinet survived a near-miss mortar attack by the Provisional IRA on 10 Downing Street in February 1991. The British mainland was subject to renewed IRA attacks on civilian targets, and bombs exploded at Victoria and Paddington railway stations in the same month as the Downing Street attack. Major began to investigate ways of bringing an end to the troubles in Northern Ireland. Eventually he and Albert Reynolds, Taoiseach of Ireland, launched the Downing Street Declaration in December 1993. It affirmed the right of the people of Ireland to self-determination and that N. Ireland would only be unified with the rest of Ireland if a majority of its population was in favour. An important part of the Declaration was the Principle of Consent, whereby the people of the island of Ireland had the exclusive right to solve the issues between North and South by mutual consent, which formed a basic tenet of the 1998 Good Friday Agreement.

In February 1992, Major signed the Maastricht Treaty, which is the foundation treaty of the European Union which succeeded the EEC. Discussions between the twelve members were mainly concerned with provisions for shared European citizenship, the introduction of a single currency and for some form of common foreign and security policies. He secured an opt-out from the single currency and from the social chapter, which would no longer allow a veto to be applied by any country to decisions on working conditions and labour relations. He feared European policies would restrict his plans to encourage a versatile working economy which could perform effectively in the modern global market. Labour would not approve the Maastricht agreement in protest against the social-policy opt out, whilst Conservative Eurosceptics opposed the whole idea of closer union. Major only won a majority when he insisted that the parliamentary vote to ratify the treaty was a confidence vote.

Almost as soon as the Major government was formed, the country entered into a recession with cripplingly high interest rates. The Chancellor Norman Lamont was unable to stimulate the economy by reducing the cost of borrowing, because any move to reduce interest rates would lower the pound’s value and take it below the limits against the Deutch-mark prescribed by the ERM. With a general election due no later than June 1992, Major tried to win public approval with the abolition of the Poll Tax, a pledge to reduce inflation and the Citizen’s Charter scheme which intended to improve poor performance in the public sector with a set of targets and guidelines by which to measure progress. Major was a supporter of public services; he not only wished to improve performance, but also to make the culture of the sector more open and consumer-focused. The scheme faced opposition from within the Civil Service, but despite some failures, the Charter eventually began to change the culture of public services and some of the ideas remained in place after a change of government in 1997.

Major went to the country in April 1992. The Conservatives were impeded by the continuing recession and the barely contained rift among members over Europe. The Labour party under Neil Kinnock had modernised itself and trimmed to a more central position on the political spectrum. At the 1985 party conference he had won widespread admiration for his full-blooded attack on the leftist Militant Tendency. Compared to his dynamic style, John Major was a quiet, uncharismatic character. He toured the towns and cities and addressed voters from a soap box set up in their town centres or at their places of work. The Labour party was now master of the glitzy electoral methods which had once been the preserve of the Conservatives and Kinnock and his supporters basked in the glow of expected victory at an eve of poll gala held in Sheffield. The next day, despite gaining 42 seats, the Labour party lost its fourth general election in a row, the Conservatives won a massive 14 million votes, the highest number in history, which, however, only resulted in a small overall majority of 21. Kinnock resigned and John Smith became the new leader of the Labour party.

The Chancellor announced that green shoots of economic growth were appearing. Inflation had halved to 4.5% in 1991 and interest rates were reduced to 10%. However, further and faster cuts were prevented by a rise in German inflation, caused by extra spending resulting from the reunification of Germany. The Bundesbank raised interest rates to stifle inflation. This caused a rise in the value of the Deutchmark and put pressure on the pound within the ERM system. International hedge funds noted the pound’s fragility vis-à-vis the Deutchmark and began to short sterling (i. e. they placed bets that its value was going to fall). On ‘Black Wednesday’, 16th September 1992, intense activity on the foreign exchange markets forced the pound below the level allowed by ERM rules. Attempts to prop up its value by raising interest rate to 15% failed and that evening Major and Lamont were forced to concede that the pound sterling could not remain in the ERM system. The pound floated downwards for a time, interest rates fell rapidly and economic recovery was soon apparent, followed by a significant rise in employment.

Lamont had never been in favour of a single European currency and was not too disappointed that he had to withdraw sterling from the ERM. He introduced a new monetary control based on inflation targeting; his aim was to keep inflation within the 1-4% band, falling into the lower end of the range by the end of the Parliament. Under the new targeting scheme, interest rates were cut to 6% by January 1993 and inflation remained stable at around 2.5% throughout 1993. However, in order to balance the books, Lamont’s 1993 budget included a raft of tax increases over the following three years. With poor press coverage of the budget and some matters in his personal life, added to continuing electoral losses, Major removed Lamont in a government reshuffle at the end of May 1993. When Lamont left office, the UK economy was growing faster than any of the other G7 countries accompanied by a low inflation rate. Out of office, he became a critic of the European Union and was influential in arguing the case for UK withdrawal from the EU.

Despite economic improvement, the government was damaged by continuous party quarrelling over Europe. In June 1995 Major challenged his opponents within the party by resigning as Conservative party leader. He won the resulting contest by 129 votes, but a quarter of his MPs voted for the rebel John Redwood. The Conservative majority was reduced progressively during the course of the parliament due to defections of MPs to other parties, bi-election defeats and the temporary suspension of some MPs who voted against the government on European policy. Going into the 1997 election, the Conservative benches were reduced to a minority in the Commons. It was claimed that the Major regime instigated Britain's longest period of continuous economic growth, but it never recovered from the damage done to its reputation for sound economic management by ‘Black Wednesday’.

One of Major’s problems was constitutional, rather than political. The marriage of Charles Prince of Wales to Lady Diana Spencer had proved to be a disaster. Each had declared their unhappiness in the most public way on TV programmes. Public perceptions were that Charles was a difficult man with avant garde interests such as global warming and organic farming, whilst Diana was a warm-hearted woman who threw herself into good causes such as help for victims of AIDs and the clearance of landmines. In December 1992 it was Major’s duty to inform the world that the couple were going to separate. In August 1996, two months after the queen urged the couple to divorce, the prince and princess agreed a settlement whereby Diana retained her apartments at Kensington Palace and the title of Princess of Wales, but agreed to relinquish the HRH title and any future claims on the British throne.

Major held off calling the election until the last possible moment, but he met inevitable defeat on 7th June 1997 when the Conservatives suffered their worst general election result of the twentieth century. They were opposed by a Labour party which had lost its leader when John Smith died of a sudden heart attack in May 1994. Having arrived at an agreement with the other leading contender Gordon Brown, Anthony (known as Tony) Blair became leader and renamed the party New Labour with a red rose as its symbol, instead of the red flag of international socialism. He advocated a looser connection to the Trade Union movement, the ending of Clause 4, which committed old Labour to wholesale nationalisation, and closer integration into the European Union. The Liberals also gained from the Tory nightmare. Led by Paddy Ashdown they won 46 seats, the highest number won by any third party since 1929.

Despite signs that some sections of the British public was less than enthusiastic about the EC, the issue of Europe played little part in the campaign. The Referendum party, founded by financier James Goldsmith to force a referendum on British membership of a federal Europe, fielded candidates in 547 constituencies without success, apart from persuading about 200 Conservative candidates to declare in their manifestos that they were opposed to the official party policy of joining a common European currency.

Eighteen years of continuous Conservative rule had been accompanied by immense cultural and social movement as well as the fundamental political changes already outlined. Many more people now owned their own home and thousands of tenants had taken the opportunity to buy council house homes at discounted rates. Two-car families were becoming quite usual, millions regularly took holidays abroad and more young people were going to university. Nearly everyone now shopped in supermarkets, and catering, hospitality, gyms and other service industries were expanding to provide many more places where people could enjoy their leisure hours. Mobile phones were on the verge of being the ‘must have’ personal accessory, home computers were becoming commonplace and many people were getting acquainted with the internet.

Public services such as the NHS and local government now employed greater numbers. Financial services had expanded enormously and brought a new, internationally mixed population into London and some other cities. Large open-range office blocks to cater for the new digital age were rising above the city sky-lines. The UK remained celebrated for popular entertainment, sport, theatre and other cultural events; cheaper air travel brought millions to the prime tourist centres as well as the newer centres of popular interest such as Liverpool. However, the immense, unionised industrial work places, employing thousands, were mostly closed down, as were most of the country’s coal mines. There was a growing North-South divide, with many old industrial areas unable to share in the upsurge of prosperity enjoyed in the south east.

Class divisions were still denounced as a besetting British sin, but many factors, including the spread of higher education, home ownership and the pop culture originated by the Beatles and others had undermined the old rigid class hierarchy. Many class divisions were eroded and society comprised a mainly middle-class population graded by fine distinctions from the elite professionals down through the salaried ranks and self-employed service-providers to the better-paid, home-owning artisan worker with a measure of job-security. Below them, a poorer class got by with the aid of welfare payments and/or poorly paid, possibly intermittent, employment.

Sadly, drugs had become an endemic problem everywhere and gave rise to crime ranging from shoplifting and prostitution to robbery and homicide, breaking homes and wrecking communities everywhere, although the damage was most evident in the poorer areas.

Some of the most noticeable social changes throughout the eighties and beyond were the growing racial tensions in the inner cities and the efforts to achieve women’s equality. The women’s liberation movement had begun to attract notice when women burned their bras in the sixties. Their daughters had benefited from better education and information about the prejudice they faced in the workplace and elsewhere. Although the country’s head of state for over forty years was a woman, and Mrs Thatcher had been prime minister for eleven years, women were still struggling to gain equality of opportunity in many areas. For instance they were grossly under-represented in the House of Commons, where decisions effecting everybody’s lives and families were decided by an overwhelming male majority. A growing cohort of women were determined to break through the glass ceilings which kept them out of top jobs in the professions, commercial businesses and the political arena.

Racial minorities regularly complained about harassment and continuous, low-grade racial prejudice on the city streets, in the workplace and elsewhere. There was particular dislike for police activities in some city areas plagued by drug related crime. The situation was aggravated by political groups such as the National Front which incited hatred among the poorer and less-educated white sections of the community, but less conspicuous racial intolerance was also some-times clearly evident throughout the social scale. Occasional eruptions of violence inflamed feeling on both sides and the homogeneity of an interracial society which many liberals craved was submerged in fractured communities and a widespread belief by some minorities that, like women, they suffered from suppression of their right to free and equal opportunities.

These were the benefits and problems which faced Tony Blair and Gordon Brown when New Labour came back to power in 1997.

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